Proshare Logo
   Market Date: 19-12-2014   
Agriculture ARTS FINANCE All One Min News Archives Bonds Cap Mkt Sentiments Capital Market CASHLESS NIGERIA Commodities Corporate Earnings Daily & Weekly Market Updates Enterpreneurship ETFs Forex Frauds & Scandals General Global Market Insurance Investors NewsBeat Islamic Finance Mergers & Aquisitions Money Market Mortgage Mutual Funds Nigeria Economy Oil Sector Opinions and Analysis Pensions People Personal Finance Politics Power Products & Services Professionals Property Public Offers Private Placements Regulators REITs Stock PICKS Taxation Telcos Travel & Tours Unlisted OTC MARKET World of Business

Firm sues bank over sale of Lagos property, claims N8m damages

Category: Investors NewsBeat


  Read (1245)
Firm sues bank over sale of Lagos property, claims N8m damages


A Lagos based construction company, Buebe Ventures Limited, and its Managing Director have dragged Skye Bank Plc before a Lagos High Court, over the sale of a property, it used as a collateral for a facility.



The company, in the suit is challenging the sale of the property the bank sold located at Plot 372, 'T' Close, 21 Road, FESTAC Town, Lagos, without due process and alleged falsification of documents.The plaintiffs, who claimed N8 million as damages averred that they obtained from the defunct Co-operative Bank Plc, which was taken over by Skye Bank, an over draft facility of N3 million for a period of six months on March 1997, which was repaid.



According to them, the repayment encouraged the defendants to advance another facility of N4.5 million for 30 days, repayable on February 2002, while the property located on Plot 372, 'T' Close, 21 Road, FESTAC Town, Lagos was used as collateral. The company further averred that it reached an agreement with the bank that the facility will be serviced from the NPA contracts, which was well reflected in the necessary agreements.



It averred, "while the NPA patronage lasted, the debt was regularly serviced, while in 2000, a Deed of Mortgage was executed to confirm the security and the rights of parties were clearly stated in the said Mortgage Deed, which was filed with Federal Housing Authority, the statutory body in charge of land and property in FESTAC Town, Lagos.



Further, the company argues that "regrettably, its source of financing the facility dried up because the NPA refused/failed to award it new contracts or pay for contracts already awarded and as a result, it had difficulties and servicing the facility became difficult and impossible, owing to no patronage, the account with the bank became dormant since 2003 and all through the period, defunct Co-operative Bank, in spite of repeated demands, refused to furnish us, our statement of account to enable it confirm or raise queries, if any, on the entries/charge on its account".



According to the company, "rather than comply with normal/ordinary banking practice of making available statement of account to us, our statement of account, the defunct Co-operative Bank was in the habit of confirming to us, on request, the balance on our account without making available any statement of account supporting these balances. And owing to their refusal to furnish us with the statement of account, we were constrained to rely on whatever figures given to us by the bank".



They added that "on October 30, 2003, relying solely on what the bank represented, we admitted owing the bank about N11.4 million and the bank's admission of N19 million as debt was based on what the bank told our MD in Ibadan, Oyo State after a meeting. The bank was at all material time to this suit, our banker, until unfolding event punctured our confidence and trust in the bank again, from the period, owing to the zero patronage from NPA, we were able to meet up with our financial commitment to the bank, with respect to the overdraft facility, the credit granted by the bank to us acquired the status of 'non-performing' credit facility and in accordance with the Prudential Guidelines of the CBN, issued on November 7, 1990 to all licenced banks in Nigeria".



The plaintiffs are further contending that "under the said guideline, a credit facility becomes 'non-performing', if interest on principal is due and unpaid for 90 days or more" and that the credit facility granted by the bank falls under the 'non-performing' category because of the interest on the principal became due from February 9, 2003 and same remained unpaid for 90 days or more.



According to the plaintiffs, in flagrant violation of the guidelines under consideration, Skye Bank continued to roll-over the non-performing credit facility without taking into account the repayment capacity the borrower, adding that since it was no longer enjoying the patronage of NPA, it therefore has no capacity to repay the facility.



The plaintiffs are, however, saying that they were more concerned that even when the statement of accounts were eventually provided, it provided conflicting figure, contrary to what the bank had presented, claiming that the bank deliberately inflated the its debt with a view to making it impossible for them to liquidate the inflated/bloated debt and that the purported sale of their property, was carried out when negotiation between parties was on-going, after the bank had given the impression that it would not do anything to jeopardise their interest.



According to the plaintiffs, the actual debt was still in dispute when the bank went ahead to sell the property, praying the court to declare same as illegal, invalid, null, void and consequently of no effect whatsoever.



The plaintiffs are asking the court to declare "the sale of their property pursuant to a forged Deed of Mortgage as illegal, unlawful, invalid, null and void and of no effect whatsoever", in addition to praying the court to set aside the purported sale of the property. Meanwhile, the bank in its reaction has denied any wrong doing, insisting that it's acting within the terms covering the facility granted the plaintiffs.



According to the bank, "all we did was in accordance to the agreement entered between parties".No date has been fixed for hearing of the suit.


(Source:Guardian) 



Tags: , 



Comment With Your Facebook or Yahoo! ID


Latest news


News on Investors NewsBeat

About Us

Who We Are
Our Team & Partners
Corporate Governance
Advertise with Us
Subscribe / Unsubscribe
Site Map
News Feed - RSS
Newsletter
Contact Us
Volunteer Program
Message from CEO
Resources

News & Features
The Analyst / Market Data
Investor Relations Portal
The Regulator
Economy & Politics
WebTV
Training Portal
Events Calendar
NewsStands - Online Reputation

Products and Services

Research & Market Intelligence
Analyst Services
Offers & Rights Support Service
Investor Relations Services
Alert & Subscription Services
Share Support Services
Proshare Consult
Event & Seminar Coverage
Market Directory
File a Complaint
News & Analysis

#1minNews
News from TheANALYST
Video News from WebTV
Money Market Updates
Opinions & Analysis
Nigerian Economy
Market Data
The Regulator
Newsletters
Discussion Forum
Policy

Subscriber Agreement
Privacy Policy
Data Policy
Disclaimer
Copyright Policy
Trademarks
Comments in Site
Advertising Code
Conflict of Interest
Content Partnership
3rd Parties

Online Trading and Execution
Training
Legal Support Services
Web/Technology Services
File a Complaint

CBN Governor 2014